City could learn a thing or two about money management from county

As we’ve frequently noted in these pages, it’s difficult for local governments to cut expenses.

A school district must educate its pupils, a municipality must provide for public safety and transportation networks, and Colorado counties must pay for courts, jails, and countywide public safety programs.

Businesses and individuals might, when revenue shrinks, simply reduce expenditures. Businesses make do with last year’s computers and scuffed office furniture, while individuals go to basic cable and keep the 1999 Toyota.

But when governments need to cut back, it has to be done carefully and intelligently. Elected and appointed officials need to be pessimistic in forecasting revenue and unafraid to make painful cutbacks. Like individuals threatened with losing their jobs, governments can’t just keep on keepin’ on, vainly hoping that the economy will improve and miraculously bail them out.

That’s why we were pleased to learn, late last week, that the El Paso County Board of Commissioners believes that the county government is, thanks to years of cutbacks, well-positioned to survive the ongoing recession.

Chairman Jim Bensberg said that the county’s strong position is the result of cutbacks and revising certain tax collection policies.

“It’s a twofold process,” he said, “We’ve made painful cuts countywide, based on realistic prospects. Many county offices are only open four days a week. Our employees haven’t had raises for the last four years. Also, we devised a more equitable way to collect the county use tax from builders, which has strengthened revenue.”

Formerly, Bensberg said, county collection policies allowed certain builders to evade the use tax by “drop-shipping” construction materials directly to the building site. Such maneuvers, he said, were typically employed by well-financed out-of-state entities.

“We leveled the playing field,” Bensberg said,” so smaller local builders can compete more effectively with the big boys.”

It can certainly be argued that the city’s over-reliance on sales tax revenue makes its situation inherently more volatile than that of the county, which derives significant revenue from the property tax. And, as city officials have often contended, the voter-approved version of the Taxpayer’s Bill of Rights which was added to the city charter during 1991 is even more restrictive than the statewide constitutional amendment.

But even given the differences, the city suffers by comparison. County elected officials have been cutting for years, even in the face of angry opposition — and not just from Democrats. Commissioners have been willing to take the heat, to be accused of heartless incompetence and of cutting county government so deeply that it would no longer be able to perform its basic functions.

By contrast, the city has not responded coherently or realistically to its dire situation.

Last April’s bumbling attempt to retain $3 million annually from a property tax that will expire at the end of the year was hasty and disjointed — even comical. It was clear that city elected officials had no plans to deal with massive revenue shortfalls, other than making apocalyptic predictions and blaming Douglas Bruce.

Bensberg said that such problems are not easy to solve.

“There’s no one single thing you do,” he said, “except spend only that which you have.”

Our Poll

What's your reaction to the Regional Business Alliance hiring Dirk Draper as president and CEO?

Great news. He's an energetic leader and will represent the city well.

Unsure. He can mend fences with political leaders, but how about economic development?

Too late. The organization will need years to recover from its missteps.